Fare adjustment’s impacts on travel patterns and farebox revenue: An empirical study based on longitudinal smartcard data

Abstract

Fare policy plays an important role in transit operations and management. To better coordinate and achieve the multidimensional goals of a proposed fare adjustment policy (e.g., increasing revenue, managing demand, and improving equity), a fundamental step is to evaluate its travel pattern impacts, which helps us consider the policy in a bigger socioeconomic context. Existing studies rarely investigate the impacts of such a policy on different users’ and user groups’ travel patterns and transit operators’ farebox revenue using longitudinal data from sources such as smartcard data. To fill this gap, we exploit 24 weeks’ smartcard data from Wuhan, China, to empirically quantify those impacts. We find that (a) the fare increase had significant but varying impacts on travel patterns across users and user groups; (b) confronting the fare increase, commuter groups identified by the topic model reduced their trip frequency more but later as compared to other groups; (c) low-accessibility, long-distance, and single-destination metro riders were less sensitive to the fare increase; (d) when there was a system-wide fare increase with a distance-based structure, trip purposes and socioeconomic statuses could better predict the impacts on the travel demand and farebox revenue than spatiality. These findings indicate that increasing average fares while offering discounted tickets for frequent and/or captive riders could maintain the existing ridership and farebox revenue and possibly increase additional ridership.